Northwest One Project Announces Start Date

The District announced today its decisions on how to proceed with the first major phase of Northwest One. In an 11am press briefing, the Mayor announced that DC-based Banneker Ventures will join developer William C. Smith & Co. to build 300 units of housing in place of the vacant parking lot at the intersection of North Capitol and Patterson Streets. Groundbreaking is now expected in "spring" of 2010, according to Mayor Adrian Fenty.

The $80m project will include 313 new housing units, with 30% pledged for "affordable" housing. 59 of the units will be set aside for former Temple Courtiers.

The Warrenton Group has been having a good year with DC officials, having been named recently as the local partner for the planned Park Morton, a $130m project announced earlier this month, and having been selected last December (as Banneker Ventures) to build the Deanwood Community Center, and last October rebuild the Strand Theater. Warrenton Group was also given a new lease on life for the Florida Avenue parcel, awarded to Banneker by WMATA in 2008 but not built out.

Architecture firm Eric Colbert & Associates will design the 12-story building, and William C. Smith & Co affiliated WCS Construction team will build it. The larger Northwest One project, in all $700 million worth of development, will also include Jair Lynch and affordable housing provider Community Preservation and Development Corporation, which together will team up as the One Vision Development Partners as a Certified Business Enterprise.

Park Morton Gets a Two-For

Just over a year after DC announced the Request for Proposals (RFP) concerning the $130 million initiative to redevelop Columbia Height's Park Morton public housing complex, DC Mayor Adrian Fenty chose Park View Partners (Landex Corp., Warrenton Group and Spectrum Management) to move forward with their plan for 500 new units of affordable, work force and market-rate housing and a 10,000 s.f. park. The architect for the project is Wiencek and Associates. In a surprise move officials described as a"two-for," the Park Morton developers will also absorb the land on Georgia Avenue currently owned by the Central Union Mission to bring a wealth of mixed-use development to the Georgia Avenue Corridor. A ground breaking date was not announced. The Park View team won out over the narrowed down field of teams named in March including the Park Morton Partners (Pennrose Properties, LLC, FM Atlantic, LLC, and Harrison Adaoha, LLC) and the other Park Morton Partners (Neighborhood Development Company and Community Builders, Inc.). Deputy Mayor for Planning and Economic Development, Valerie Santos, praised Landex for it's experience in successfully completing redevelopment projects of distressed urban housing, including HOPE VI projects, in cities along the East Coast. The announcement about Central Union Mission came as a surprise, as the group recently went before the Board of Zoning Adjustment (BZA) and carried out a series of community meetings about their planned development at Georgia Avenue and Newton Place. According to Catherine Fennell, a consultant working as the Project Manager with the Warrenton Group, the Mission continued moving forward while the award for Landex was pending. But Fennell indicated the two groups have been working on their agreement and will make the purchase official now that the award for Park Morton was announced. The Park Morton project is one of four designated New Communities, an initiative begun by Former Mayor Anthony Williams. Others include Barry Farm, Northwest One, and Lincoln Heights/Richardson Dwellings, all of which, the Mayor today promised, would continue forward with a guarantee of "no displacement" for current residents.

Washington DC commercial real estate news

Industry Insight: Adrian G. Washington of the Neighborhood Development Company

As the founder and CEO of the Neighborhood Development Company (NDC), Adrian G. Washington has overseen numerous development initiatives in the District with a primary focus on boutique condominiums and affordable housing in Columbia Heights and along a resurgent Georgia Avenue corridor. In between working on a current slate of projects that includes the Residences at Georgia Avenue, the Heights on Georgia Avenue and a proposal for the mixed-income redevelopment of the Park Morton public housing complex, Mr. Washington spoke with DCmud about the state of development in the District of Columbia, the challenges of affordable housing and what the future of the residential market. 

Can you give us an overview of the company? 

I’ve been doing this for about twenty years. I started out as basic as it gets - rehabbing brownstones – and moved up from there. Then, I worked for a big corporate real estate company called the National Housing Partnership and we did a lot of affordable housing stuff. I started NDC about ten years ago by doing really the same sorts of things – rehabbing brownstones. By the next year, we were doing 4-unit buildings, then 10-unit buildings and it sort of just got bigger and bigger. It really kind of took off about five years ago. I brought in my partner here and a couple of junior partners, a couple of vice presidents who really brought it up to a professional level. We started doing bigger projects. We were lucky to be on teams that got selected to do CityVista and the old Convention Center site, now called City Center. We really kind of rode the condo boom when it was hot; we had a lot of really cool boutique projects. So it started out focusing on Columbia Heights because we’re always emerging neighborhood focused. When Columbia Heights became more established, we sort of shifted it. So for our last projects, we’ve done a lot of stuff up and down Georgia Avenue – projects like the Lofts at Brightwood and Lamont Street Lofts. We’ve also done some affordable rental projects like the Residences at Georgia Avenue. As the economy shifted, we started doing more affordable rental projects. Our Heights at Georgia Avenue project will be almost like a sister project – same size, same kind of concept with affordable housing on top and retail on the ground floor. Then we proposed on the Park Morton site and we’ll also be proposing on two of the DC school sites. We’ve teamed with EYA on the Hines School site and with Equity Residential on the Stevens School site. 

Indeed, most of your new construction seems to be focused on Georgia Avenue.  Are you still bullish on the area? 

We hope so. We like it. We’re headquartered here and I live about five minutes away. We’ve always been focused on this area and we just saw it as the next “cool neighborhood.” You have Columbia Heights to the east and with Georgia being a Great Street, the city’s been really interested in what we’re doing and certainly helped out on a lot of things. We’ll be coordinating with them for some of the infrastructure improvements with Great Streets. It’s a really great transportation corridor. It’s got some good parcels that are available and, particularly at the start, there were some great industrial buildings that you could convert to lofts. There's not as much now, but it’s a great area and we kind of adopted it as our backyard. We really wanted to be focused on particular neighborhoods, which is where we are. 

How does the current state of the market affect a company that’s primarily focused on affordable housing? 

I think it’s been good and bad. When things started getting tougher, most people - me included – said affordable housing financing is not going to be affected by the credit crisis. Well, in fact, it has. The most popular mechanism for financing affordable housing is the low income housing tax credit, where essentially you get credits that allow companies to reduce their taxes. Well, a lot fewer companies have taxable gains these days, so the market for that – while it hasn’t crashed – has declined considerably. Also, the District a lot of times provided gap financing. A lot of that comes from the Housing Production Trust Fund that is funded by sale and recordation taxes. At the same time, the gaps have gotten bigger because construction costs went up and land values went up. The District used to be fairly flush and now they’re pretty tight. That’s been a little challenging, but the good thing is that the demand is still there. Land prices are starting to retract a little bit and construction costs are starting to mitigate. So it’s much tougher, just like private development is much tougher. But I think DC is really strong market with basic fundamentals like what you can rent things for and demand. I really haven’t seen things as bad yet as I read in the papers and I’m optimistic because demand for things like condos and rentals really haven’t declined as much as the headlines suggest. 

One crucial element of development is retail. CityVista, of course, has a Safeway and your newly completed building, the Residences at Georgia Avenue, is planned to include a Yes! Organic Market. How do you go about making neighborhoods once thought undesirable attractive to retailers?

Those were two very different cases. In terms of CityVista, Safeway was part of the team right from the beginning. Actually, before we became part of the team, Safeway and Lowe Enterprises, our partners, were already linked to that project. Safeway saw it as a great place to put a new urban model Safeway. The thing with Yes! Organic is that we approached them very early on. We didn’t have a broker or anything. They just saw it as a great location. We had some personal connections with Gary Cha, the head of the company, and, as matter of fact, he liked it much that he wanted to buy it because he saw the potential of the neighborhood and said, “I want to get in on the ground floor.” That’s how we’ve done it. We had the Meridian Restaurant at our Lofts at Brightwood project and it was the same type of thing – a really entrepreneurial retailer that was willing to take a chance and invest in the neighborhood in the same way we were. That’s how we traditionally work – not through brokerage channels, but with retailers who’ve really gotten it and want to get in early on a project and help design the project to meet their specifications. It sort of goes together. 

At this point, it’s safe to say that CityVista has been a success, while other projects in the immediate area have stumbled. What would you chalk that up to? 

 It’s funny because we just had a case study that ULI did and they put together all the people –developers, contractors, lawyers and architects. One of the things that we talked about was doing a true mixed-use project – some condos, some apartments and retail. It’s really hard from a construction standpoint, from a legal standpoint, from an architectural standpoint, but if you get right and you get the right mix…synergy is a corny term, but it really applies to this. We got this great Safeway, we got Busboys and Poets and we have a real mix of retailers at the base, all of which people really want. These kind of lifestyle-type things help it be a place where people really want to be. NoMa is still kind of an emerging neighborhood and people want to feel like they have a sense of community – a place where they can live, they go downstairs to shop, they can go out to eat, they can go to go the gym. And not just a little in-house gym, but a really cool gym like Results. It’s a really cool place and what we’ve seen is that it’s drawn people from all over. You think it would be people who live in different parts of DC, but we have people from Prince George’s County and Virginia. It’s just been a nice sort of synergy and I think the rental component energizes the condo component and the condo component energizes the retail component and vice versa. And I think it’s priced right. It’s not entry-level pricing, but it’s not super-luxury pricing either and a lot of people can afford it. We knew we were going to sell like that.

NDC has a record of vying for some prominent District issued RFPs, including Park Morton, CityVista and 5th and I. How would you characterize your relationship with the Fenty administration and the Office of the Deputy Mayor for Planning and Economic Development? 

I’m not an insider or anything, but I value and appreciate what they’re doing and I’d like to think that they feel the same about us. I feel that our goals converge. They’re interested in developing Georgia Avenue and we are too. They’re interested in promoting local businesses and I live in the city, I work in the city and I hire people in the city. It’s matter of being on the same page and understanding their challenges. For me, having been inside the government at one time, I understand what it’s like to be on the other side of the table - the challenges that you have from a political perspective and from a legal perspective. A lot of times, you go through these long agreements with people and can seem like, “Why are they asking for that? It makes no sense.” Having been on the other side of the table, I understand that they have to get certain things through certain offices and fiscal years and so on. Having spent a bit of time in their shoes helps me understand what their hot buttons are and what’s important. That helps the negotiation process. The important thing is that we share the same goals. We want improve neighborhoods. We want to work with the community. Like most developers, we feel that we have to reflect what’s going on and what people are looking for. 

Are there any details that you can share about your proposal for the redevelopment of Park Morton? 

The first thing that I really want to emphasize is that we’ve teamed with a really great partner. They're called Community Builders. They’re Boston-based, but they have a DC office. They’re really the leading non-profit developer in the country. They’ve done over 20,000 units in terms of projects. They really specialize in these sorts of difficult public housing transformations. They have a great human capital program and do things like job training, education and public safety – things that affordable housing demands. Our team, with our local knowledge and our skill, is a great combination. Essentially, we stuck pretty close to the plan that was developed when we were part of the task force that designed the original Park Morton plan that was in the RFP submission. They’re looking for a three-phase plan – roughly a third, a third, a third - that will provide homes for all the current people who are there and then mix them up with moderate income and market rate. It’s, give or take, 500 units of housing. We’ll be demolishing this area [along Park Road] for Phase I and building a total of 195 units. We’ll have [a separate] building dedicated to senior citizens and mixed-income units. Prior to demolition, we would provide for the relocation of families that are in there now and put them in units in and around the area, so they could stay in the neighborhood. We’d then demolish the [second area along Morton Street] and move people into the first phase, along with new people from outside the community and build another roughly 250 units. Then, finally the third [along Lamont Street] would be building condominiums. By that point, we think the neighborhood will have improved, the market will have improved and that it would a great place to do a condominium building. 

Many owners of undeveloped property are now caught between inability to get financing and maturity default. How is NDC positioned to make it through the next two or so years? 

I think we’re well positioned. We’re either lucky or smart. I’m happy to take either one. We’ve done condo projects over the years and about two years ago, we began to sort of feel something in the air. Four years ago, if you built something, people were lining up. As far as two years ago, things began to slow down and we decided to decrease our exposure to condos. We did a couple of projects, but they were very value priced and we were able to sell out of those. Right now, we have zero exposure to condos. Our project across the street, the Residences at Georgia Avenue, is a moderate income rental. We’re in lease up now and we’re getting tons of responses, so we feel very good about how that project is going to perform. The Heights on Georgia Avenue that’s basically across the street from Park Morton, we just got through with PUD and we’re just looking for financing now. Again, we think we’ve created a product that’s moderately priced and we’re pretty optimistic that we’ll get financing for that. We think that we’re in a very good place. We’re lucky to be part of CityVista that, amidst all the problems, is performing well. We’re well-positioned and I think it’s a great time to be a developer. A lot of newcomers and weaker competitors will be going away. It’s more challenging – you need more creativity – but that’s kind of cool.  

Is it possible to be profitable selling new construction there in this environment? 

I think so. It has to be the right place and the right design. And one of the really crazy but cool things is that things change so quickly. Our focus has been on the kind of building - it’s called podium style - that has first floor retail with four or five stories of residential above it. It’s a stick-built product. What happened in the last few years is that the delta between concrete buildings and stick-built really expanded. This was kind of a nice sweet spot in terms of building a building that’s six-stories high, but the cost per square foot was a lot lower. That was the threshold and, if you wanted to go any higher than that, you’d have to go with concrete. We really looked at this as model for the Heights and Park Morton and we’ve seen prices for this come down. What we don’t know is if concrete construction is going to come back down and become much more competitive. You’ve got to moderate, just from a supply and demand perspective – not just in the US, but around the world. A lot of stuff is clearly not going to get built. Commodity prices, concrete construction, oil and gas, steel – all that’s come down and the demand for labor has come down as well. 

Do you see NDC starting any market-rate condominium projects in the near future? 

Oh yeah, absolutely. Whether you’re condo or rental, I think that DC is great place to live. I think in terms of a competitive advantage, with the new administration and the Stimulus Package, that the city is becoming more in demand. I liked the city before the market went down and I like it even more now. I think that supply and demand is going to come back into balance. We’re seeing things like the month’s inventory start to come down. Real estate is cyclical. We had a particularly strong up cycle and now we’ve had a particularly strong down cycle, but it’s going to come back. Just in terms of how long it takes to do things, if you look at the demand, I think the trade-up buyer has kind of decreased a little bit and speculative investment buyer has gone away completely. But that first-time buyer and the price point from three to five hundred thousand has pretty much stayed there. But nothing’s getting built. Nobody, for any kind of project of any significant size, is starting. There’s nothing in the pipeline now and the way these projects work is that if you’re not in the pipeline now, you’re not going to deliver for at least three years – more like four or five. As the economy straightens itself out and demand is solid and starts to increase, the supply is going to be way low. Things that will be delivering in two, three or four years, I think there will be a great market for. We could easily do a boutique building of under a hundred units in that time frame. I’m really bullish on that.

Washington DC commercial real estate news

DC's Development Pipeline in 2009

Developmentally speaking, 2008 was a big year for the District of Columbia. While it was the annus horribilus for real estate, it did witness the opening of eagerly anticipated projects like CityVista, Union Row, and of course, Nationals Stadium, to name a few, and saw other big ticket developments like the Southwest Waterfront project and The Yards stride further toward realization.

Still, many District-solicited projects await the green light to begin construction, in the process of selecting a team or are still up for grabs. Here's a breakdown of those projects and where they stand for 2009.

Available Proposals:

In one of their more unique offers, the Office of the Deputy Mayor Planning and Economic Development (ODMPED) is currently seeking a developer to take control of a 13.5-acre concrete manufacturing facility at 1515 W Street, NE. The site is currently operated by the District Department of Transportation, which plans to vacate the facility by August. Any new tenant will be required to submit to a ground lease agreement for a minimum of 10 years. Proposals for the “Develop and Operate a Concrete Plant Solicitation” are due by January 9th.

As previously reported, ODMPED is currently seeking a development team to revitalize two long-abandoned properties at 400-414 Eastern Avenue and 6100 Dix Street, NE, in the Deanwood neighborhood. The city government is looking to redevelop the properties into an affordable housing complex with a local retail component. Proposals are due to ODMPED by February 16th.

One of the bigger projects currently on deck with the city government is the redevelopment of several “excess” schools, closed due to recent budget shortfalls and threadbare facilities. These include Backus Middle School, Grimke Elementary School, Hine Junior High School, the Langston School, M.M. Washington High School, the historic 1911 school building of Randle Highlands Elementary School, Rudolph Elementary School, the Slater School, the unoccupied portion of Slowe Elementary School, Stevens Elementary School, and Young Elementary School. The sites will not be put to their former use; any plans will be considered, provided they exhibit a “creative vision for development or reuse” and “an understanding of neighborhood context.” A pre-bid conference will be held January 9th, proposals for the redevelopment of any or all of the facilities are due by February 27th.

ODMPED has also “amended and restated” their solicitation of offers for the Park Morton public housing project redevelopment that had been previously announced in September of last year. Proposals for that project are now also due by February 27th.

Proposals Submitted:

Bidding recently closed on three vacant parcels the District intends to re-appropriate as parking lots: 463 I Street, NW (available for 24 months until construction commences on Donohoe’s Arts at 5th & I project), 2 Patterson Street, NE and 33 K Street, NW (formerly the demolished Temple Courts public housing complex).

Proposals were received in September for two District-owned parcels at Fourth/Sixth and E Streets, SW – one piece of which is intended to house the Metropolitan Police Department’s new Consolidated Forensic Laboratory.

An announcement is anticipated soon regarding proposals submitted in October for the Hill East Waterfront/Reservation 13 project, which is intended to include more than 5 million square feet of mixed-use development and an extension of Massachusetts Avenue, SE – the latter of which is already underway. As of November, the District had narrowed down the contenders to competing four development teams.

The so-called “Lincoln Lots” – two V Street, NW parcels adjoining Shaw’s historic Lincoln Theatre – were also the subject of an RFP that closed this past September. ODMPED was seeking “developers to assist in repositioning real estate associated with the [theatre] to complement and benefit the ongoing operation of the Lincoln.”

Development Partners Selected:

Of the projects solicited by ODMPED over the past year, the majority have already been snatched up by development teams. These include Blue Skye Development, in concert with the Mayor’s New Communities Initiative, for an abandoned apartment complex at 4427 Hayes Street, NE; Donatelli Development and Mosaic Urban Partners for two parcels at 3813-3815 and 3825-3829 Georgia Avenue, NW; Blue Skye Development and the Educational Organization for United Latin Americans for the abandoned Tewkesbury building at 6425 14th Street, NW; Argos Group for two District-owned Capitol Hill properties at 525 Ninth Street, NE and 1341 Maryland Avenue, NE (aka Old Engine House 10); Donohoe Companies for the Arts at 5th & I project in the Mount Vernon Triangle; Donatelli Development and Blue Skye Development for the $108 million mixed-use project adjoining the Metro station at Minnesota Avenue and Benning Road, NE; the William C. Smith & Co., Jair Lynch Companies, Banneker Ventures LLC and CPDC for the $700 million, 1600 unit Northwest One New Community that also includes retail, office and medical components; Clark Realty for the massive, $2.5 billion redevelopment of Southeast’s Poplar Point community; and, lastly, Washington Community Development Corporation and Banneker Ventures, LLC for the transformation of Deanwood’s dilapidated Strand Theatre into a mixed-use retail and office complex.

Project Taken to New Heights on Georgia Avenue

Like a snowball rolling downhill, the number of residential developments on Georgia Avenue is getting bigger by the minute. The latest project on the boards is The Heights at Georgia Avenue by the Neighborhood Development Company (NDC) - a 100,000 square foot mixed-use building that will feature 100% affordable housing. Besides adding 69 new apartments to the Petworth real estate market, the project at the intersection of Georgia Avenue & Lamont Street NW will also add roughly 10,000 square feet of retail to the mix. The developer is currently engaged in talks with a hardware retailer about the site and hopes have a sit-down restaurant in place when The Heights opens its doors in early 2011.

The Heights' all-affordable status has put it in a unique position with the District of Columbia. This week, Councilmember Jim Graham will introduce a bill before the City Council that aims to grant the project an exemption from property taxes for the next 40 years - provided it maintains an at least 50% margin of affordable housing in that time. The proposal should be voted upon sometime this fall.

NDC president Adrian G. Washington told DC Mud that ANC approval for The Heights at Georgia is forthcoming. “We’ve met with the ANC on several occasions and gotten a letter of support from the single-member district commissioner…We’re actually going tomorrow and we hope they will formally approve it.”

The Georgia Avenue site was acquired by a partnership of NDC and Mi Casa Inc. – a DC-based non-profit that specializes in restoring aging properties and converting them into affordable housing. The Heights will be their second brand-new new construction project (the first being the Rittenhouse Project in Brightwood). The building is being designed by architect Graham Parker and will come in at a cost of approximately $25 million. Construction is slated to begin in the fourth quarter of 2009.

The Heights is only one of numerous projects currently in development in the Petworth neighborhood. Up the street at 4136 Georgia, Formant Development's proposed 57-unit, 7 story condominium tower is still scheduled to go to ground in 2009. Meanwhile, Donatelli Development’s Park Place is currently under construction and their proposed project across the street at 3801 Georgia recently issued a BID to contractors. These twin projects are joined by the massive redevelopment just up the street of the Park Morton public housing complex.

UPDATE: The Heights at Georgia Avenue's final address has been confirmed as 3232 Georgia Avenue NW - across the street from the NDC's Lamont Lofts project that was completed in 2005.

Washington D.C. real estate development

Northeast DC Icon Gets a Little Help

Mayor Fenty was on hand today to announce that the District has finally settled on a developer and would move ahead with redevelopment of the long-abandoned Strand Theater in Deanwood. The project is now in the hands the Washington Community Development Corporation (WCDC) and Banneker Ventures LLC - organizations that plan on transforming the 80-year-old former movie theater into the new home of an 18,000-s.f. restaurant and 18,000 square feet of “affordable” office space. The remaining 16,000 square feet within the Strand will be “dedicated for community and cultural uses,” according to a press release issued by the Mayor’s office.

“There will be more energy back on this corner for the neighbors who live in the Ward 7 community, east of the river in general and for the entire city,” said Fenty from the sidewalk of 5131 Nannie Helen Burroughs Avenue, NE. Fenty and WCDC head Rev. Steve Young, also leader of the Holy Christian Missionary Baptist Church for All People located across the street, went on to promise that 30 - 40 new, permanent jobs will created as a result of the revitalization effort.

Curiously enough, this marks the second time the District has named the WCDC and Banneker as developers in charge of the Strand. The first came this past July, when Deputy Mayor Neil Albert told DC Mud that the project would “break ground in the next two weeks.” Sean Madigan, the Mayor’s press contact, today told DC Mud the District was forced to hold off a bit, while the rest of the details concerning the theater were hammered out.

Banneker has had a dream year lobbying District officials, having secured from District work on the Strand, and having been named Master Planners for the Park Morton redevelopment, and as a developer of the $700 million Northwest One development. WMATA added to the company's portfolio by naming Banneker the lead developer in June for its Florida Avenue project, and Banneker has its own plans in place for 814 Thayer, a 52-unit condominium in Silver Spring's central business district. WMATA Board member and DC Councilmember Jim Graham reportedly pushed for the developer's inclusion in the project; WMATA said it chose the developer based on its "experience," noting the technical difficulty of building a project on top of an existing Metro tunnel, though Banneker has no previous experience building above a Metro tunnel. Or, apparently, above much else. Park Morton, 814 Thayer, and the WMATA project have yet to break ground, and Northwest One has only recently done so, leaving the conversion of several small apartment buildings into condominiums as its only achievements. Banneker's website touts its appointment to several of the above projects, as well as its "tremendous breadth of experience and professionalism." Calls to Banneker’s metro area offices went unanswered.

As it stands today, Green Door Advisors and Blue Skye Construction will handle the build-out of the heavily dilapidated building, located at the intersection of Burroughs Avenue and Division Avenue NE. The Strand Theater is currently on the DC Preservation League’s list of Most Endangered Places in the District. Hopefully, that will be changing as the Strand moves on to a bigger and better future.

Washington DC commercial real estate news

Re-Inventing Public Housing at Park Morton

Mayor Adrian Fenty today announced the District's Request for Proposals (RFP) concerning the $170 million initiative to redevelop Petworth's Park Morton public housing complex. Although currently seeking a development partner for the deal, the city has already forged ahead and outlined their intentions for the site: 317 market-rate housing units, 206 affordable housing units, a 10,000 square foot park and a new community center with green designs throughout. The mayor prefaced his comments to the press by assuring the current residents in attendance that they will be relocated to new units in the project and that "no one will be displaced."

Mayor Fenty credited the New Communities Initiative established during Anthony Williams' tenure as mayor (which also includes Barry Farm and Lincoln Heights, in addition to Park Morton) as the genesis of the new development and explained how the city planned on manifesting change in an area best described as derelict and dangerous. “It is about bricks and mortar because a lot of these projects are old. They need a lot of work and, to be honest with you, just re-doing them isn’t going to cut it,” he said. “But its also about more than bricks and mortar. We’re also going to have health care facilities, schools, recreation centers, and job training centers here at Park Morton.” The mayor concluded his remarks by stating, “It’s important to note that while this in-and-of-itself is an important opportunity and investment for the Georgia Avenue corridor, this is just one of the many different things that are happening.” He went on to specifically cite Donatelli Development Inc.’s $70 million, 156-unit Park Place project and neighboring $5 million retail investment, along with Jair Lynch’s 130-unit apartment complex at 3910 Georgia and the District’s own new, mixed-income development on the 3400 block (more to follow from DCMud in the coming weeks) as other in-the-works projects aimed at making area attractive to prospective residents and retailers. 

Ward 1 Councilmember Jim Graham, who had introduced the initial city council resolution for the Park Morton project and led community meetings on the subject, followed Mayor Fenty’s turn at the podium. He began by reiterating the mayor’s promise that no residents would be displaced by the project and promised that the upcoming changes would result in “a much more successful and livable community than we have today.” He also said that the District would not repeat mistakes with regard to public housing that have plagued the city for decades. “Gathering all the poor people in one neighborhood, in one building, ought not to be the preferred approach,” he said. “When we have the opportunity to create mixed-income, diverse background [housing], that is an opportunity we should not lose.” He went to specify that the new Park Morton will become a beacon of diversity in Ward 1, “without losing a single person who is here today.” Michael Kelly, Executive Director of the DC Housing Authority (DCHA), went on to trumpet the long-term viability of a new community comprised of “low income, moderate income and market-rate people.” And sounding a bit like George Washington at the Continental Congress, Kelly referred to it as "This grand experiment," asserting that the project "is [due to the leadership] of Washington, DC, and has not been replicated anywhere else in the country.” 

Kelly cited the Housing Authority’s upkeep of current Park Morton facilities, including the addition of new boilers, stairwells and security cameras as initial steps towards a better quality of living. He then went on to ask the assembled residents if such efforts had made them feel safer – and received a rousing reply of “yes.” Following the remarks, all in attendance were led on a tour of the newly remodeled Park Morton Children’s Center. As the first example of Park Morton revitalization, Mayor Fenty inspected the new computer lab, classrooms and music rehearsal spaces that are to serve as a hub of community operations during and after construction. BIDs for the Park Morton project are due by December 12th with final selection to occur in March. 

Washington DC commercial real estate news

DC's Development Pipeline

Ever since the Fenty administration took over development of the District's publicly-owned property, merging agencies and placing them under his direct supervision, it seems development of blighted blocks has been given a new urgency, even compared to that of the Williams administration - itself a great improvement over its predecessor. But despite weekly announcements from the Mayor and the Office of Planning and Economic Development, many of the projects still have to proceed through the District's infamously thick bureaucracy. But if China can cleanse its murky atmosphere in a few short months, there is cause for optimism that change is in the air here in Washington. DCMud has prepared a rundown of the largest projects now underway, properties in need of developers, and solicitations to look for in the future.

The projects listed below are still being refined. The numbers and square footage assigned to each are conceptual and are subject to change.

Projects With Developers

Southwest Waterfront by Hoffman Streuver will offer 539 market-rate units and 231 affordable units. The $1.5 billion project will also include 350 hotel rooms, 700,000 s.f. of office space and 280,000 s.f. of retail space. On July 15th, the DC Council approved a $198 million TIF/PILOT package to finance park and infrastructure improvements. Groundbreaking is not expected any time soon, with construction lasting at least 6 years.

Waterfront, the erroneously named project at 401 M Street, SW, will deliver 800 market-rate and 200 affordable residential units as well as 1.3 million s.f. of office space and 110,00 s.f. of retail space. Mayor Fenty joined SW Waterfront Associates (Forest City Wasington, Charles E. Smith Vornado) in November to demolish the former Waterside Mall. The $800 million project will sit atop the Waterfront -SEU Metro station.

Clark Realty was selected in February as Master Developer for Poplar Point on the east side of the Anacostia. The number of residential and hotel units they will deliver has not yet been determined, however 30% of all residential units will be affordable. The District and the National Park Services held a public scoping meeting last month for the Environmental Impact Statement of the $2.5 billion project.

Center Leg Freeway on Massachusetts Ave, NW between 2nd and 3rd Streets is being developed by Louis Dreyfus Properties into 100 market- rate and 50 affordable residential units. The $1.1. billion project will cap the exposed section of I-395, and include 2,100,000 s.f. office space and 67,000 s.f. retail space.

The McMillan Sand Filtration Site on North Capital Street and Michigan Avenue will be developed into 820 market-rate units, 351 affordable units, and a 100-room hotel by EYA. The $1 billion project will also deliver 700,000 s.f. of office space and $110,000 s.f. of retail space. The project has long been worked over, but don't make plans for moving in any time soon.

In May the District reached a deal with Hines Archstone to develop a 400-room "high-end" hotel and 100,000 s.f. of additional retail space on "Parcel B", a 53,000 s.f. plot of land that is part of the larger CityCenter DC, the development taking up residence on the old convention center site. The entire $850 million project downtown will deliver 539 market-rate units, 135 affordable units, 476,000 s.f. of office space, and 266,000 s.f. of retail space.

On June 26th, Marriot International, Cooper Carry Architects and EHT Traceries presented plans for the Convention Center Headquarters Hotel to the Historic Preservation Review Board. Located on the Corner of 9th Street and Massachusetts Avenue, NW, the $550 million project will deliver 1125 hotel rooms and 25,00 s.f. of retail space. Having been scaled back from its original 1400 bed facility, the project is well past its early schedule, of construction in 2007.

O Street Market at 7th Street and Georgia Avenue will be transformed into a mixed-use development that will include 550 market-rate and 80 affordable residential units by Roadside Development. The $329 million development will replace a current Giant supermarket with a new 71,000 s.f. store and include a 200 unit hotel and 87,000 s.f. of retail space. The District reached an agreement with the developer late last month to kickstart financing. Of the dozens of projects promising to revitalize the Shaw neighborhood, this may be the first large project to actually get underway.

Skyland Shopping Center on Good Hope Road at Naylor and Alabama Avenue, SE will be developed by Rappaport Companies and William C. Smith Companies into a $261 million development with 155 market-rate units and 66 affordable units as well as 230,000 s.f. of retail space. When? Even an estimate will be fine.

City Vista, which began sales in late 2005, will bring 441 condos with 138 affordable residential units to, as well as a separate apartment building, to 5th and K Streets, NW. The project will also include 130,000 s.f. of retail space and will cost $191 million. The first condominium building completed last October, the remaining condominium and the apartment building are nearly ready for occupancy.

Early this year, Fenty signed a Land Disposition Agreement with Broadcast Center One Partners LLC, (Ellis Development and Four Points, LLC) that will bring African-American-owned Radio One to the district. The $144 million Broadcast Center One at 7th and S Streets, NW will be a mixed-use project with 135 market-rate and 45 affordable residential units as well as 96,000 s.f. of office space and 22,000 s.f. of retail space. According to Fenty's office, "the deal also sets in motion the $22 million redevelopment of the Howard Theater, a long-shuttered landmark that was the hub of black Broadway." If it gets built; the timeline remains uncertain.

Mt. Carmel (Parcel 51B) on 3rd Street, NW between K and H Streets is being developed by MQW LLC (Quadrangle and the Wilkes Companies) into $130 million mixed-use project with 267 market-rate units, 67 affordable units and 90,000 s.f. office space.

Forest City Washington is responsible for the $120 million O Street SE Redevelopment by the SE Federal Center. It will deliver 354 market-rate units, 89 affordable units and 47,000 s.f. of retail space.

The Village at Dakota Crossing in Fort Lincoln by Ft. Lincoln New Town Corporation will include 327 market-rate and 30 affordable units. It will cost $110 million.

Mid City Urban and A&R Development will bring 216 market-rate and 54 affordable residential units as well as 70,000 s.f. of retail space to the area around the Rhode Island Avenue Metro station with their $105 million Rhode Island Station project. First attempted as a condo project, developers have bowed to the market and substituted apartment buildings - at least in theory, as the project has yet to break ground.

The $100 million Shops at Dakota Crossing on New York and South Dakota Avenue, NE will be developed by Ft. Lincoln New Town Corporation into 29,000 s.f. of office space and 461,000 s.f. of retail space.

Lowe Enterprises and Jack Sophie Development have long had intentions to develop Riggs Road and South Dakota Avenue, NE (Triangle Parcel) into 208 market-rate units, 52 affordable units and 23,223 s.f. of retail to the tune of $75 million. The fate of the project is uncertain, as higher construction costs, shrinking condo prices, and more conservative lending practices - especially in low-income neighborhoods, make such projects harder to justify.

Park Place on Georgia Avenue in Petworth will be developed by Donatelli Development into 161 market-rate units, 32 affordable units and 16,000 s.f of retail space and will cost $60 million. Purchased by Donatelli, along with partners Gragg & Associates, Canyon Capital Realty Advisors and Earvin 'Magic' Johnson, will be one of the few developers delivering new condos in 2009.

In February, the District made a Term Sheet with Parcel 42 Partners to develop 95 affordable housing units and 8,000 s.f. of retail space on Parcel 42, in Shaw at 7th and Rhode Island Avenue, NW for $28 million.

In December 2007, the District selected William C. Smtih Companies and the Jair Lynch Companies to develop the $700 million Northwest One New Community that will deliver 1,600 units of housing on former NCRC parcels as well as adjacent DC-controlled and private properties in Ward 6. Located between North Capitol Street, New York Avenue, New Jersey Avenue, and K Street, the site is in an area that has "long been plagued by high crime and poverty", but is surrounded by the up-and-coming NoMa and Mt.Vernon Triangle neighborhoods. The development team, which also includes Banneker Ventures and CPDC (affordable housing provider), will create apartments, townhouses, and condos for all income levels as well as over 40,000 s.f. of retail and 220,000 s.f. of office space. The development will also offer a 21,000 s.f. clinic.

And further down the road...

The District issued a solicitation in early June for Parcel 69 at 4th, 6th, and E Streets, SW. The $130 million development will be an office and hotel project along the Southwest freeway. Proposals are due by September 15th.

In May, Fenty issued an RFEI for the Hill East Waterfront on Capitol Hill East. The District seeks a developer to create 2,100 market-rate and 900 affordable units with 2,000,000 s.f office space and 67,000 s.f. of retail space. The District anticipates a price tag of $1.1 billion for the development of the 50 acres surrounding the former DC General Hospital. Proposals are due by October 31st.

Proposals were due June 3rd for Minnesota and Benning Road, NE Phase II. The $107 million development will include 60 market rate, 392 affordable units and 40,000 s.f. of retail. No developer has been selected.

It is high time the District announced developer for Fifth and I Street, NW. After proposals were submitted in March, the District widdled the teams down to the final four including BG, Buccini/Pollin, Potomac Investment Properties, and a group comprised of Holland Development, Donohoe Development, Spectrum Management, and Harris Development. The winning team, whenever they are announced, will create somewhere around 170 market-rate units, 30 affordable units, 100 hotel rooms and 50,000 s.f. of retail space.

Upcoming Solicitations

The District would like to see 1,469 market-rate and 440 affordable units in Lincoln Heights in Ward 7 at an estimated cost of $576 million.

Barry Farm/Park Chester/Wade Road in Ward 8 will likely include 110 market and 330 affordable housing units and will cost around $550 million. The project is an effort to revitalize low-income properties in the historic Anacostia area.

The issuance of the Park Morton solicitation at Park Road and Georgia Avenue, NW is "imminent" according to the Mayor's office and will cost $136 million with 499 market-rate and 150 affordable units. Axis

From AWC to NCRC to DMPED, Fenty Lauds Change

Mayor Adrian Fenty, Deputy Mayor for Planning and Economic Development Neil Albert, and Councilmember Jack Evans (D-Ward 2) held a public ceremony this morning to celebrate the one year anniversary of the District's decision to disband and take control over the portfolios of the Anacostia Waterfront Corporation (AWC) and National Capital Revitalization Corporation (NCRC). In a tribute to their combined foresight, the Mayor lauded the District's "significant progress" on over two dozen key from the portfolios since the merge, and offered up morsels of imminent announcements. "There were a lot of properties in these two quasi-public entities and it was the decision of the Council of the District of Columbia to make sure that those properties moved a lot faster, that they got developed quicker, and most importantly, that people saw results and I can say that a year later there has been a flurry of consistent activity," Fenty said. With $60 billion in the citywide pipeline since 2001 and $13 billion in current economic development projects, the Office of the Deputy Mayor's portfolio now includes over 12,000 residential units - including 4,500 "affordable" units - 1,800 hotel rooms, 2 million s.f. of retail space, and 8 million s.f. of office space.

Looking back on their recent successes, the Mayor noted that on May 14th, the District issued a RFEI for a master developer for Hill East Waterfront, 50 acres around the former DC General Hospital site. On June 4th, the District issued a solicitation for a development partner for Parcel 69, a potential $130 million office/hotel project by the Southwest Freeway. Master land planning began at Boathouse Row in SE on July 11th. On Tuesday, the Council approved a $198 million TIF/PILOT package to fund park and infrastructure improvements for the $1.5 billion Southwest Waterfront redevelopment. Yesterday the District selected Argos Group to develop two properties on Capitol Hill, including the Old Engine House 10 into eight condominiums. And looking forward, Albert told DCMud the Strand Theatre project (5131 Nannie Helen Burroughs Avenue, NE), developed by Washington Metropolitan Community Development Corporation and Banneker Ventures, will break ground in the next two weeks. He added that his office will also announce a developer for 6425 14th Street, NW in the coming weeks, a 12,100-s.f. parcel of land in Brightwood. Sean Madigan, Director of Communications in the Office of the Deputy Mayor, predicts an announcement for 5th and I, as well as Minnesota-Benning Road, NE, in the next few weeks, and that the Park Morton development group will be announced "imminently." Evans, who had a hand in the creation of both the NCRC and the AWC, said the decision to create the organizations was correct at the time, as was the decision to consolidate them. "I was there for the creation of NCRC and AWC and at the time when we were looking at putting those semi-private entities in place, the District government wasn't functioning, and so the idea of having an NCRC was something like the Pennsylvania Avenue Development Corporation model to get economic development projects done in the city," Evans said. "Then we learned that the semi-private entities were not doing what they were supposed to and we rolled them back into the government and put them under the Deputy Mayor and as we said today, it seems the decision was absolutely the correct one, because now we have a unified government and we can now focus on these projects and get them done. What we did in the past made sense and what we did last year made sense and we are now celebrating the results of those actions," 

Evans concluded, as the development troika lauded each other's vision and accomplishments. Albert added that a major goal of the consolidation was to establish one point of accountability for economic development in DC, but also to save taxpayers money. "One of the reasons the Council and Mayor worked so hard to consolidate the agencies, was to make sure that there was a single point of accountability on all economic development projects here in the District. Citizens had been asking for it, and they got it with this merger. Also, this merger resulted in significant savings for the taxpayers - over $5 million in savings because of the consolidating," Albert said. Like a gloating parent, Fenty added, "I just love efficient government, we have too much waste - a lot of these quasi-public commissions and entities and boards, they just spend money wastefully and we're gonna put a stop to that too." 

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